Upsides in Elnusa
Shares of Elnusa (ELSA), oil and gas services company controlled by Pertamina, gained 2.27% Monday (Oct 29) to respond the company’s solid performance in third quarter. The stock, however, has consistently been valued below its equity and traded with PE multiple 8.9 on annualized 2018 earnings.
Solid Q3 for Bayan Resources
Bayan Resources (BYAN), the largest coal producing company by market capitalization, booked net profit of US$388 million in the first nine months of 2018, jumped by 80.1% from the corresponding period last year. The company’s net profit margin was substantially lower in the third quarter, but remained above peers.
Freeport Indonesia’s Strong Nine Months
Freeport McMoRan (FCX), parent company of PT Freeport Indonesia, booked net profit of US$556 million in third quarter ended Sept 30, nearly doubled from the corresponding period last year. FCX, accordingly, reported net profit of US$2.12 billion in Jan-Sep 2018, skyrocketed from US$776 million only in the same period last year.
Strong Third Quarter for Vale Indonesia
Nickel producer PT Vale Indonesia Tbk (INCO) booked net profit of US$55.38 million in the first nine months of 2018 against loss of US$19.8 million in the corresponding period last year, thanks to higher average prices and improved margins. The company recorded net profit of US$26 million in third quarter alone, almost the same with total profit in the first half.
Coal Journal
WTI and Brent crude fell sharply by 4.3% and 4.4% to US$66.3 and US$76.3 per barrel respectively, but natural gas gained 2.58%. Thermal coal, meanwhile, slipped 0.46% to US$110.47 per ton. Indonesian economy should continue to benefit from high coal price, at least until the first half of 2018.
Pertamina Refinancing
State-owned oil and gas company Pertamina has late last week commenced cash tender offer for the combined US$2.24 billion worth of Senior Notes issued in 2011 and 2012 as part of a refinancing transaction. In the period of 2011-2014, Pertamina issued US$8.75 billion worth of Senior Notes overseas to finance, among others, acquisition of offshore and domestic assets.
IEV Gas & CNG Business
Back in mid 2008, PT IEV Gas started to develop and utilize the Compressed Natural Gas (CNG) in Indonesia as a new alternative (cheap and clean) energy or fuel, replacing expensive diesel fuel, marine fuel oil, and liquified petroleum gas (LPG). It planned to build CNG stations in Java island, starting with at CNG plant in Jababeka industrial estate, Cikarang (Bekasi), West Java.
Indonesia Gains More from Nickel
Nickel might have left its recent peak due to global trade concerns, but Indonesia is set to become a stronger player in the commodity next year. Jinchuan, one of the world’s largest nickel producer, is scheduled to start commercial operation of its nickel pig iron (NPI) smelter in Obi Island, North Maluku province in the coming months.
Coal Journal
China Coal Energy Co Ltd produced 6.39 million tons of coal in September 2018, flat year-on-year (y/y). It had declined 3.6% for the first nine months of 2018 to 55.87 million tons. Coal sales, on the other hand, grew 10.6% to 12.93 million tons last month, and 19.3% to 114.38 million tons in the first nine months of 2018.
Walk the Talk: Alumina
Oggy A Kosasih, managing director of INALUM, holding company for state miners, and Li Wangxing, president director of Aluminium Corporation of China Ltd (Chalco) have last week signed cooperation agreement for the development of the long-delayed smelter grade alumina (SGA) project in Mempawah, West Kalimantan at the sidelines of IMF-World Bank Annual Meetings in Bali.